Slow justice system aids those seeking to loot assets

March 12, 2008

This elder financial exploitation story out of North Carolina accentuates some important points to keep in mind when dealing with or trying to understand (good luck!) Involuntary Redistribution of Assets (IRA) actions. First, if an IRA target is a live elderly person, asset poachers recognize the advantage to draw out proceedings so as to hopefully outlive their mark and any other parties likely to lodge complaints.

Second, prolonged investigative or legal actions can be expensive – both financially and emotionally. IRA practitioners know that the prospect of an impending long-term dispute can serve as a deterrent to even start an action. Sadly, this is a commonly used tactic often employed and usually yielding results favorable to the asset looter.

And third, while any proceeding is being dragged out, a trustee, executor, conservator and, if they are not an attorney, their attorney-of-choice plus other “professionals,” can continue to extract resources from an estate. By the time the judicial system acknowledges your financial abuse or exploitation, the culprits can have emptied the coffers. So, who’s the real winner?

Let’s hope that the American Bar Association resolution mentioned in this story is a sincere attempt to generate attention and promote action with regard to providing prosecutors additional resources for use in elder abuse cases. It probably is. After all, it would ultimately provide more cases for lawyers.

Pardon our cynicism — it’s just based on knowledge that the ABA membership includes attorneys who perpetrate IRA cases. Perhaps some internal house-cleaning would be appropriate rather than advocating only another expense to fall on the shoulders of honest, taxpaying citizens. EoD knows attorneys who find these “walker stalker” lawyers offensive and appreciates the efforts of those who valiently fight to expose their peers who loot assets of the dead and disabled.

And a last important point, don’t think IRA practitioners can’t be well-heeled, respected members of your community. While EoD has come across some serious “polecat” asset poachers, the individual as described in this article (“a respected businessman, a farmer and a member of the local hospital’s board of directors”) provides an important reminder that low character exists in society’s highest echelons.

Justice Often Slow for Elder Crimes
Experts Seek Tools to Fight Rise in Abuse
Thomas Goldsmith, Staff Writer (thomas.goldsmith@newsobserver.com or 919-829-8929)
March 10, 2008
The News & Observer (Raleigh, NC)http://www.newsobserver.com/news/story/991319.html
CLINTON – So far, Mary Morris has spent three years and $73,000 to get back just part of the $475,000 that was withdrawn from her mother’s accounts by the relative who was overseeing the elderly woman’s affairs.

Morris’ mother agreed, three years before she died at age 96 in 2004, to give legal power of attorney to a grandnephew. It’s a step that many advocates for older people say should be considered when people begin to show signs they are having difficulty managing finances, selling property, making acquisitions and buying insurance.

But a caution always accompanies that advice: Be careful whom you trust, and be careful about giving total authority to one person.

“You need to make sure that you either thoroughly trust your agent or you have some kind of controls on the agent’s abilities to move assets,” said Bob Mason, an Asheboro lawyer and vice chairman of the elder law section of the N.C. Bar Association.

Legal experts project a massive increase in lawsuits and prosecutions involving older Americans in decades to come as baby boomers reach retirement age and beyond. Already, substantiated instances of elder abuse are rising nationally at the rate of 15 percent a year, according to the American Bar Association. ABA members recently adopted a resolution urging that prosecutors be given more resources to fight elder crime.

Last year, North Carolina adult protective services sent county district attorneys written notices of 1,451 cases involving abuse, neglect or exploitation of adults. The numbers represent a 15
percent increase in cases since 2004.

Advocates say civil and criminal legal protections for older people are at the stage where domestic violence and child abuse safeguards were two decades ago — in need of reform.

“As we have an aging population, there are reasons to say prosecutors should be paying more attention and using more resources to deal with what’s going to be an increasing problem,” said Stephen Salzburg, a Georgetown University law professor and co-author of the ABA resolution.

A sensible precaution

In many ways, Morris’ mother did the right things when she gave her grandnephew, Allie Ray McCullen, 63, the legal power to manage her affairs. She had been in the hospital, and her health was failing. McCullen was a respected businessman, a farmer and a member of the local hospital’s board of directors.

“It’s one of the first things we encourage people to do when there’s an early diagnosis of dementia: Let’s talk about a power of attorney,” said Dee Dee Harris, family services director of the Alzheimer’s Association, Eastern N.C. Chapter.

“When we don’t get the power of attorney in place early, if Mom or Dad starts making bad decisions, the kids can’t step in to protect them.”

Money goes missing

After Morris’ mother died and her estate was assessed, however, Morris discovered that at least $450,000 was missing. Bank statements included in Sampson County court records show that McCullen wrote himself dozens of checks as financial decisionmaker for Mary S. McCullen, Morris’ mother and his great-aunt.

“The more we got into it, the more I was surprised at what he had done,” Morris said.

McCullen did not respond to repeated requests for an interview.

Morris, 77, filed to have Allie Rae McCullen removed as executor in Sampson County Superior Court, and in a two-hour deposition taken in 2006, McCullen did not deny writing the checks to himself and his businesses. In October 2006, he signed documents promising to pay Morris $450,000 within a year, giving her a $25,000 first payment at the time.

In February, McCullen paid Morris $296,000 from a land sale. Morris said she is still waiting for McCullen to pay the remainder, while the cost and annoyance of the case keep increasing, she said.

“I just want to see justice served,” Morris said.

Family feuds

Cases of abuse and exploitation of older people can tear families apart; in many cases the abuser is a family member or close friend. Even when victims or relatives take their cases to authorities, advocates say, it can be hard to get the attention of police or prosecutors who are already overburdened with violent crime.

“Sometimes seniors are reluctant to testify because the perpetrators are their own children or family members,” said Lori Levin, a former Illinois prosecutor and co-author of the ABA resolution.

David D. Jones, 35, a Raleigh resident, has “called and called and called” Raleigh police to get them to arrest his sister, Natashi Jones, 25. Natashi Jones, according to a civil court order, received all the money from a $46,853 life insurance policy left by the siblings’ late father.

Court records show Natashi Jones swore in a Wake County assistant clerk of court’s office that she had no brothers or sisters, and she was issued the check as the sole beneficiary. She then paid more than $2,000 to get it cashed immediately at a check-cashing business, according to an order finding her in contempt of court.

Bob Morton, a Raleigh lawyer, helped Natashi Jones prepare an inventory of her father’s estate last year, but he said Friday that he does not know how to reach her. David Jones said Friday he’s still trying to recoup some of his inheritance.

“I’m sitting here left with nothing, and my sister got away scot free,” Jones said. “It’s like they pushed the thing under the rug.”

Chris Brewer, a Raleigh lawyer in private practice and the former head of the state’s Medicaid Investigations Unit, thinks prosecutions of crimes against older people would “certainly” increase if local prosecutors offices had the kinds of resources and expertise outlined in the ABA resolution.

“The offices are doing the very best they can under the circumstances, but there are not enough resources even for the more violent crime,” Brewer said.

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Estate of Denial® provides news, analysis and commentary on abusive probate practices and via wills, trusts, guardianships and powers of attorney. We provide perspective to educate the public regarding this and other growing threats to both individual freedoms and property rights.